October 2015 Wisconsin Independent Agent Magazine by Independent Insurance Agents of Wisconsin

wisconsin

INDEPENDENT AGENT OCTOBER 2015

2015-16 IIAW EXCLUSIVE COMPANY SPONSORS SEE PAGE 6

THANK YOU!

At West Bend, weâ&#x20AC;&#x2122;re proud of our broad base of knowledge when it comes to commercial risks. Over the years, however, weâ&#x20AC;&#x2122;ve developed extensive expertise of certain risks and the skills needed to underwrite them. Thatâ&#x20AC;&#x2122;s why weâ&#x20AC;&#x2122;re more competitive in writing these classes. Like precision metalworking. If you have a precision metalworking risk, contact your West Bend underwriter. We look forward to sharing our expertise with you, and providing the best coverages necessary to protect your valued customers.

wisconsin

INDEPENDENT AGENT OCTOBER 2015 Eric Schwartz, Editor

Open Door Policy Strategic Partnerships to Train and Recruit Diverse Talent into Independent Insurance Agencies . . . . . . . . . . . . . . . . .5 2015-16 Exclusive Company Sponsors . . . . . . . . . . . . . . . . . . . . . . . . . . .6

On The Cover…

Virtual University Words Matter: Minor Policy Language Changes Can Have Major Consequences . . . . . 22

The recent Fall Planning Session at

Marketing 5 Musts for Marketing to Millennials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 2015-16 Fall Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Errors & Omissions How to Fire a Customer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 OCI State Based Systems Information Sheet . . . . . . . . . . . . . . . . . . . . 34 Members in the News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36 Technology IRS Warns Taxpayers About Scam Artists . . . . . . . . . . . . . . . . . . . . . . . . 38 Commentary From Counsel Lessons from Deflategate! . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Independent Insurance Agents of Wisconsin 725 John Nolen Drive, Madison, Wisconsin 53713 Phone: (608) 256-4429 or (800) 362-7441 ■ Fax: (608) 256-0170 ■ Web: www.iiaw.com Executive Vice President - Matt Banaszynski 2015-2016 Executive Committee President......................................................... Steve Leitch P.O. Box 85, River Falls, WI 54022 President-elect .............................................. Matt Weimer 100 North Corporate Dr., #100, Brookfield, WI 53045 Secretary-Treasurer .......................... Lise Meyer Kobussen P.O. Box 633, Sauk City, WI 53583

Jack Riesch P.O. Box 1610, Waukesha, WI 53187-1610 Michael Walston P.O. Box 236, Kewaunee, WI 54216-0236 Darrel Zaleski 4233 Southtowne Drive, Eau Claire, WI 54701 2015-2016 Committee Chairs

Milford Hills kicked off the IIAW’s 2015-16 year. It’s the perfect time to thank all of our Exclusive Company/ Platinum Level Sponsors for the incredible support they provide. This year we welcome Burns & Wilcox, Liberty Mutual and Sentry Insurance as sponsors. Learn more about these great companies - Exclusive Company Sponsor information begins on page 6.

> ADVERTISERS & INFORMATION ACUITY Insurance ........................................... 43 Amerisafe....................................................... 33 Applied Underwriters ........................Back Cover Axley Brynelson ............................................. 32 Badger Mutual ................................................ 32

Chairman of the Board ............................. John Wickhem P.O. Box 1500, Janesville, WI 53547-15

Agency Operations....................................... Kim Dandrea 1300 South Green Bay Rd. #100, Racine, WI 53406

State National Director ................................ Linda Steiner 555 Main Street #320, Racine, WI 53403

Automation/Technology ............... Cathleen Christensen P.O. Box 949, Fond du Lac, WI 54936-0949

2015-2016 Board of Directors

Emerging Leaders ...........................................Jack Demski 101 East Grand Ave. #11, Port Washington, WI 53074

Guard Insurance ............................................. 39

Employee Benefits.......................................... Mike Farrell 1300 South Green Bay Rd., Racine, WI 53406

IIAW Continuing Education .............................. 31

Mike Ansay 101 East Grand Ave. #11, Port Washington, WI 53704 Mark Behrens 555 Main Street #320, Racine, WI 53403 Jason Bott 330 East Kilbourn Avenue, Milwaukee, WI 53202 Cindy Burns 500 South Central Ave., Marshfield, WI 54449 Gerald Couri 379 West Main Street, Waukesha, WI 53186 Mike Farrell 1300 S. Green Bay Rd., Racine, WI 53406 Chris Hanson 5601 Grande Market Drive, Appleton, WI 54913 Brian McClone 505 North Westfield Street, Oshkosh, WI 54902

WISCONSIN INDEPENDENT AGENT

Finance & Compensation ............... Lise Meyer Kobussen P.O Box 633, Sauk City, WI 53583

EMC Insurance................................................ 40 Exclusive Company Sponsors ........................... 6

Insurance Associates of America ................... 25 Packers Radio Affiliates ................................. 23

Government Affairs .......................................Skip Hansen 100 North Corporate Drive #100 Brookfield, WI 53045

Partners Mutual ............................................. 29

Industry Relations ....................................... Kevin Murray 525 Junction Road, Madison, WI 53717

Pekin Insurance.............................................. 33

Marketing & Membership Development ........... Jeff Thiel P.O. Box 1610, Waukesha, WI 53187-1610 Smaller Agencies .................................... Michael Walston P.O. Box 236, Kewaunee, WI 54216-0236 Technical ................................................... Mark Truyman P.O. Box 6, Seymour, WI 54165 Technical ...............................................Timothy Kakuska P.O. Box 547, La Crosse, WI 54602-0547

Robertson Ryan.............................................. 37 SECURA Insurance .......................................... 24 The IMT Group ................................................ 42 West Bend ........................................................ 2 Western National.............................................. 4 OCTOBER 2015 | 3

4 | NOVEMBER 2014

WISCONSIN INDEPENDENT AGENT

OPEN DOOR POLICY

STRATEGIC PARTNERSHIPS TO TRAIN AND RECRUIT DIVERSE TALENT INTO INDEPENDENT INSURANCE AGENCIES

Finding and attracting good talent is one of the biggest challenges facing all small businesses, especially independent agencies. Here at the IIAW we recognize that. With more than 400,000 industry job openings by 2020, people have a huge opportunity for growth. We are busy coordinating efforts with other industry partners to strategically align and address this emerging talent crisis. For the last few years we have been aggressively growing the InVEST program in Wisconsin by adding to the number of schools teaching insurance and discussing career opportunities. Somehow this worthwhile and important endeavor lacked a comprehensive strategy from beginning to end. That was until a recent series of events lead to a strategic partnership between the IIAW and UWOshkosh (UW-O) and its students. A few years ago, Jim Schwalen, VP of Personal Lines and

Director of the Center for Insurance & Risk Management (The Center), and his team. I was greatly impressed with their commitment to teach the next generation of insurance and risk management professionals. Evidently so were their students. In 2009, the number of students enrolled in the program stood at 12. Today there are more than 70 students involved. It was a fantastic learning experience that left me working to identify how the IIAW and UW-O could work together. Whether Jim realizes it or not, his vision and strategic thinking was the beginning of something I believe will greatly benefit our industry in Wisconsin. About a year and a half ago, UW-Oshkosh made a fantastic hiring decision and brought on Dan Kugler as their new Director for The Center. Dan’s resume and industry experience are impressive. Dan, a former member of the IIAW with Snap-On Inc., reached out to find out more about the IIAW and to discover a way we could work together. After talking extensively with him, I invited him to our board meeting last May to provide greater insight into Oshkosh’s success.

Marketing for West Bend Mutual, took me to UW-O and introduced me to Dr. Scott Beyer, current Dean of the School of Business and former Executive WISCONSIN INDEPENDENT AGENT

With Dan responsible for the Insurance and Risk Management Strategic Plan for the long-term growth and success of The Center and its programs (and with his familiarity with the IIAW’s mission, products and services), we quickly got to work brainstorming ideas. A few months ago Dan invited me to serve on the Advisory Board with other industry professionals such as Dave Pauly (Capitol) and Dick Huseby (Church Mutual). I was honored. Our task is to find a way to bring the industry together to support the insurance and risk management program and UW-O. At a recent board meeting, we discussed the success of InVEST and proposed strategically

partnering with UW-Oshkosh to be the “feeder system” (or designated educational facility) for InVEST and in doing so help to grow and expand the number of schools teaching the InVEST program. In addition, we continue to work out the details to align the teachers and guidance counselors in these school districts with UWOshkosh faculty, independent agency and carrier volunteers in order to better educate them with the needed insurance acumen to effectively teach their students. This alignment will create better synergy in the industry and increase the chances of successfully identifying and recruiting students to The Center and then into the industry. In essence, the IIAW, through InVEST and our partnership with UW-Oshkosh, is teaming up with high school and college educators to provide a useful insurance curriculum for students. Through this program, insurance students are provided with numerous annual scholarships and grants to help attract them as future industry leaders. In addition, every student benefits from an internship and mentorship program to receive handson experience needed to be successful after graduation in the industry. Several independent insurance agencies are already reaping the benefits in the form of interns and new hires. The bottom line: there is now a concerted industry effort to feed insurance educated high school students to one of Wisconsin’s best universities. The university will then supply a steady stream of highly proficient, talented and needed CONTINUED ON PAGE 32

> Matt Banaszynski is the Executive Vice President of the Independent Insurance Agents of Wisconsin. Contact him at matt@ iiaw.com.

OCTOBER 2015 | 5

C U I N D G O O R UR T N I 2015-16 IIAW EXCLUSIVE COMPANY SPONSORS

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WISCONSIN INDEPENDENT AGENT

OCTOBER 2015 | 7

Rated A+ by A.M. Best and S&P Wardâ&#x20AC;&#x2122;s 50 best-run company Named the #3 large company to work for in America Manages over $3 billion in assets 61st largest insurer in the nation In business since 1925 Less than 3% voluntary employee turnover

BURNS YES, WE CAN DO THAT

WILCOX

ACCESS IS OUR MIDDLE NAME. Our access to the widest range of domestic and international carriers means you can say yes to almost any hard-to-place risk. Give your clients what they want to hear with Burns Wilcox.

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! " Commercial | Professional | Personal | Brokerage Binding | Risk Management Services

Wisconsin’s Independent Agents We Appreciate All The Value You Deliver

• Bringing valued expertise • Local support of customers • Contributing to your communities

THE HANOVER INSURANCE GROUP Exclusively distributing through independent agents since 1852

hanover.com

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Local Independent Agents interested in learning more about The IMT Group’s products can contact Matt Casey at (800) 274-3531, ext. 897.

WWW.IMTINS.COM

WEST DES MOINES, IOWA • 800.274.3531 • WWW.IMTINS.COM

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LIBERTY MUTUAL INSURANCE Location Of Company Headquarters: Boston, MA Founded: 1912 Company Website: libertymutualgroup.com/business-insurance Regional Leadership Team: Guy DeCosterd, Midwest Region President Timothy Zepnick, Regional Vice President Jeffrey Tipton, SVP and General Manager, National Insurance Al Cruz, Underwriting Vice President Jason Paton, Distribution Vice President Michelle McLane, Director of Territory Management Bill Rankin, Risk Control Division Manager Todd Sutton, Claims Service Specialist Company Information Liberty Mutual is a diversified insurer, employing more than 50,000 people across operations in over 30 countries and 900 offices worldwide. The company is the third largest P&C insurer in the United States1 and ranked 78th on the Fortune 100 list of largest corporations in the U.S. With $124.3 billion in consolidated assets, $39.6 billion in annual consolidated revenue and financial strength and stability as rated by A.M. Best ‘A’ (Excellent), Moody’s ‘A2’ (Good), Standard & Poor’s ‘A’ (Strong), Liberty is well positioned to meet the many current and emerging obligations of our agents, brokers and policyholders. Our Value Liberty Mutual Insurance helps preserve and protect the things people earn, own, build and cherish. Keeping this promise means we are there when our policyholders, throughout the world, need us most. We are committed to the independent agency system in Wisconsin and provide the local resources and support our agents need to succeed. Liberty is uniquely poised to offer our partners strong relationships, coupled with competitive products. Liberty Mutual offers a broad appetite, market leading automation, superior services, as well as, financial security and stability. We partner to win with our agents by following 5 strategic frameworks: 1. Discipline and Execution 2. Right People, Right Place, Right Resources 3. Deliver and Communicate Value 4. Consistency and Reliability 5. Agency Engagement & Territory Management Products Company Specializes In Liberty Mutual offers a diverse set of Personal, Commercial, and Specialty products to meet the needs of our agency partners. Our Commercial Lines products include Commercial Auto, BOP and Package Policies, General Liability, Property, Umbrella, Excess Liability, Multi-National, Workers Compensation, Reinsurance, Surety Bonds, Employee Benefits, Third Party Administration (Helmsman WISCONSIN INDEPENDENT AGENT

Guy DeCosterd Management Services). Liberty Mutual also partners with our agents to offer additional coverage enhancements to meet the changing needs of the insurance market, including, but not limited to, Cyber, Manufacturing E&O, and Contractor’s E&O. In addition, through Liberty International Underwriters (LIU) our agents and brokers can access a full complement of Casualty, Specialty Casualty, Professional, Data Compromise, Energy, Marine and Construction products, all serviced by our team of world-class underwriters, claims professionals and risk engineers. Outlook for the Company’s Future While over 100 years have passed since writing the United States’ first Worker’s Compensation policy (in Wausau, WI, 1911), Liberty’s established presence and commitment to the state of Wisconsin remains tremendously strong. We are committed to providing strong, national products and services, with local presence in the state of Wisconsin. From our regional headquarters, located in Waukesha, WI, to our state of the art fire laboratory in Wausau, we remain an industry leader in both product and service innovation. Liberty Mutual Insurance is the only insurance company to receive the National Safety Council’s Green Cross Award, recognizing outstanding achievement in safety and health, community service, and responsible citizenship. Through our industry leading Risk Control, and local claims presence in Milwaukee and Wausau, our goal is to help you lower your clients’ total cost of risk while protecting your clients’ business, their people, and their property. Our risk control specialists work with you, and your client, to help identify those systemic processes that may lead to loss and help you implement practical, research-driven solutions. We pride ourselves on our understanding of the Wisconsin marketplace and our regional flexibility with local decision-making capabilities. Going forward, our agent and broker partners can expect a continued focus on profitable growth, discipline and execution, service differentiation, investment in local Wisconsin communities and efforts to know our agents more deeply than the competition. We look forward to a continued partnership with these independent agent and broker partners, so that together we may grow profitably and serve the broad needs of the commercial insurance marketplace. 1. Based on 2013 DWP as reported by the National Association of Insurance Commissioners (NAIC)

OCTOBER 2015 | 13

WHY SNAPSHOT IS GREAT FOR YOUR CUSTOMERS

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“It’s about helping our neighbors and being there for them when they need us,” said Dave Gross, President and CEO of SECURA Insurance. “Caring for others is not just a part of our 115-year history, it’s the fabric of all we do and who we are today.” The People A Midwest work ethic and helpful attitude are inherent qualities of SECURA’s people and culture. Headquartered in Appleton, Wis., the carrier attracts and develops the best and brightest employees, and provides opportunities for growth and advancement. Employees are proud of their work and enjoy a culture that helps balance family, work, and life. That translates directly to how they genuinely care for and serve agents and policyholders. The Policyholders SECURA is known for how well it treats policyholders, especially when handling claims fairly and promptly. Customers appreciate the company’s great insurance options. Even more so, they value the personal and compassionate service they receive. Most policyholders rate SECURA a “Perfect 10” after their claims experience. Perhaps it’s because of the personal phone call they receive within one hour of hearing about an accident or loss, or maybe it’s because of the lengths someone goes to in order to restore life to normal. This kind of refreshing approach earns the trust and praise of customers every day. The Agents Committed to the independent agency model, the company does business with more than 450 agents in 12 states. Agents choose to partner with the company because of the real relationships they form with SECURA employees, and the responsive and flexible approach to underwriting, making it easy to do business and setting them up for success. The carrier’s extensive agent training programs also provide professional development opportunities for agents to increase sales and profits, with follow up to help put what they learned into practice. The Products SECURA offers Commercial, Personal, Farm-Ag, and Specialty insurance products and services. The latter two are the fastest growing segments, offering many profitable opportunities. Commercial Lines is the company’s largest line of business, providing coverage for contractors, manufacturers, technology services, and numerous other markets. Setting SECURA apart from other carriers is a consultative approach to Risk Management and its unique Work Comp Nurse Hotline for commercial clients. The service results in better care for injured workers,

WISCONSIN INDEPENDENT AGENT

Dave Gross fewer claims and lower premiums for employers, and a more profitable book of business for agents. Personal Lines is SECURA’s second-largest segment, with a MILE-STONE® home and auto package that contains numerous enhancements, giving agents an edge in attracting and retaining customers. Farm Lines, which is part of the company’s heritage, expanded to include Agribusiness, insuring niches like seed merchants, custom farming, and dairy product manufacturing. Specialty Lines covers unique programs such as non-emergency transport, YMCAs and health clubs, and sports and recreation, to name a few. The Strength As a company in the service industry, SECURA continues to invest in people – its greatest asset. Looking to the future, the carrier is devoting resources to product advancement and technology to reflect the ever-changing needs of agents and policyholders. Agents know SECURA is a stable, long-term market for them. The company expects to reach more than $560 million in total direct written premium for 2016. Premium growth in Wisconsin for 2015 was more than 15 percent through August. Those accomplishments speak volumes to the quality of SECURA’s agents and people. The carrier is recognized among Ward’s Top 50 property and casualty insurance companies nationwide, and is consistently rated A (Excellent) with A.M. Best. SECURA builds strength from its people, fostering relationships with agents, caring for policyholders, and supporting the community. Those genuine traits help the company maintain success for the future.

OCTOBER 2015 | 15

SENTRY INSURANCE Chief Exectutive Officer: Pete McPartland, Chairman of the Board, President and CEO Company Headquarters: Stevens Point, WI A.M. Best Rating: “A+” (Superior) Company Website: www.Sentry.com Company Information Sentry Insurance, a Mutual Company, was founded in 1904 by members of the Wisconsin Retail Hardware Association to provide quality insurance for its members. Throughout our more than 100-year history, we have made Wisconsin our home. Sentry is one of the largest and strongest mutual insurance companies in the United States. With assets of $14 billion and a policyholder surplus of more than $4.2 billion, Sentry Insurance is rated A+ by A.M. Best, the industry’s leading rating authority. For the 24th consecutive year, we maintained our A.M. Best rating of A+ and remain one of the most strongly capitalized companies in the insurance industry. At the same time, we continued to invest heavily in our business and honor our commitment to the community. Sentry Insurance Benefits and Services Wisconsin Values You have grown your agency in Wisconsin. Just like you, Sentry Insurance is proud of our Wisconsin heritage. Sentry employs nearly 4,000 associates in 44 states, with more than half in Wisconsin. Our associates are dedicated to Sentry Insurance. In central Wisconsin, more than 400 of our associates have 25 years or more of service at Sentry.

16 | OCTOBER 2015

Peter McPartland

Your Customers Will Benefit Sentry Insurance offers the expertise to help you develop an insurance program designed to fit your customers’ needs. Whether their exposures apply to property, general liability, auto, workers’ compensation, we will work with you to design a plan that works for them. Claims Processing You will have access to our industry-leading claims and technology systems. Sentry Insurance has made a powerful promise to you and your customers to be there when needed. Safety Programs Help your customers save lives, time, and money with Sentry’s safety experts. Our team of professional safety consultants guides your customers through risk scenarios, regulatory demands, and training or program gaps.

SFMâ&#x20AC;&#x201C;The Work Comp Experts

Providing superior injury prevention, claims management and cost control services

sfmic.com

SOCIETY INSURANCE Location Of Company Headquarters: Fond du Lac, WI Founded: 1915 Senior Managers: Rick Parks, President and CEO William Reeves, Senior Vice President and COO Heather Boyer, Vice President – CFO and Treasurer Mike Zajicek, Vice President – Workers Compensation Claims Bill Bunzel, Vice President – Property, Auto and Liability Claims Amy Collett, Vice President – Human Resources Thomas Konop, Vice President – Information Systems D. Holly Lifke, Vice President – Commercial Lines Underwriting Dina S. Schultz, Vice President – Sales and Marketing Dominic Weber, Vice President – Actuary Products Company Specializes In: Society Insurance writes only commercial lines. As a niche market leader, the company has developed in-depth expertise in its core classes of business. Supported by long-term trade association endorsements from the Wisconsin Restaurant Association and the Tavern League of Wisconsin, Society writes policies for more than 25 percent of the food and beverage establishments in Wisconsin. Society’s strong tradition of association partnerships and niche expertise also extends into hotels and motels, grocery and convenience stores, artesian contractors and food processors, auto repair garages and health care clinics. The protection Society offers for its core classes of business are consistently some of the most comprehensive on the market. Workers compensation insurance was the first coverage Society wrote when it was founded in 1915, and the company maintains a strong presence in this complicated and specialized line of business. Society’s claim management process keeps costs low for policyholders by stressing early intervention, advocating a quick return to work and obtaining the best medical provider discounts. Loss control services are customer-focused and tailored to the needs of both small and large businesses. Society also offers a number of internet-based safety tools for customers of all sizes. This combination of strong claim management and tailored loss control is a true competitive advantage that eliminates many problems business owners and agents may otherwise experience with workers compensation insurance.

Rick Parks

Outlook for the Company’s Future As Society Insurance celebrates its 100th year in business in 2015, the company continues to build on its strength as a regional carrier committed to service and value for its customers. In 2014, this focus helped Society Insurance continue to grow at a steady, sustainable pace. Since 2010, the company has increased direct written premium by more than 20 percent and policyholder surplus by nearly 31 percent. As a niche market leader, Society does not try to be all things to all businesses. Rather, the company concentrates on doing what it does better than anyone else — insuring its core niches — and will continue to do so going forward. Because of this focus on niche markets, the company better understands the lines of business it writes and has exceptional knowledge and experience with issues that are likely to arise. Other Comments In an industry not known for its creativity, Society isn’t afraid to be different. And it’s the small details at Society — they’re in each policy and they’re in the way the company underwrites and handles claims — that set the company apart. Society knows that agents and policyholders have unique needs that don’t always fit neatly within a strictly defined category, so Society offers insurance uniquely tailored to the businesses they write. Sharing core values and a commitment to service with agency and association partners defines Society Insurance as a company where the small details make a big difference to agents and policyholders. Company Website: societyinsurance.com

18 | OCTOBER 2015

WISCONSIN INDEPENDENT AGENT

THE TRAVELERS COMPANIES INC. Location Of Company Headquarters: Hartford, CT Founded: 160 years ago Officers: Lorie Kates, Regional President George Hogan, Regional Director Paul Kyrilis, Regional Vice President - Commercial, Technology, Construction, Public Sector Lorie Kates Linda Petrillo, Regional Vice President - Personal Insurance Lisa Pechan, Regional Vice President - Select James Gallagher, Regional Vice President - National Accounts Casualty Mike Powers, Regional Vice President - National Property John Tsourmas, Zonal Vice President - Excess Casualty Allen Warner, Regional Vice President - Inland Marine Brendan Dunican, Regional Vice President - Ocean Marine Paul Andriscin, Regional Vice President - Boiler & Machinery Beth Printz, Regional Vice President - Claims Gail Schroeder, Regional Vice President - Bond & Specialty Insurance Steve Ringler, Regional Risk Control Director Outlook for the Company’s Future Travelers is an insurance leader, committed to keeping pace with the ever-changing needs of our customers, and anticipating their needs for the future. There is no stronger testament to our dedication to protecting customers from loss than our continued innovation and ability to transform our industry. Travelers is also committed to helping agents grow and be successful. Our people are professionals focused on delivering timely and professional service to you and our customers. We are local. With over 200 employees in Wisconsin, Travelers delivers the many attributes of a large national carrier through one of the best-staffed field offices in the state. Our staff understands the Wisconsin marketplace and is committed to developing productive relationships with you and our insureds while delivering products and services your customers are looking for. For example: 1. Travelers is the #1 writer of Commercial Lines & Workers Comp in WI.* 2. Travelers has received two “Buyers Choice Awards” from Business Insurance magazine, taking home the top honors among insurers in both the Workers Compensation and Commercial Auto categories.

4. Travelers Quantum Auto 2.0® was launched in 2013 in WI. Developed in close collaboration with our independent agents, this new auto product offers more competitive pricing to a broader range of consumers. 5. Travelers Claim is continually developing innovative tools and resources designed to help you and your customers stay safe, including our Prepare and Prevent site on Travelers.com, and our new Weather Alerts. Offered through Weather Services International (WSI), a professional division of The Weather Company, the weather alerts are sent to subscribers of the service in advance of an approaching storm reaching a particular location. Travelers understands that life and business are inherently dynamic and that the best way to serve customers is to deliver insurance that behaves the same way — evolving to keep in step with life and business as they change. Protect your clients under the red umbrella! Company Website: www.Travelers.com * AM Best Data

3. Travelers recently opened a new ConciergeClaim Nurse® location in Milwaukee. ConciergeClaim Nurse® is a comprehensive workers compensation claim program designed to simplify the claim process for injured employees, enabling them to get back to work quickly and safely.

WISCONSIN INDEPENDENT AGENT

OCTOBER 2015 | 19

WEST BEND MUTUAL INSURANCE COMPANY Location of Company Headquarters: 1900 South 18th Avenue, West Bend, WI 53095 Founded: April 1894 Officers: Kevin Steiner, President and Chief Executive Officer Dale Kent, Executive Vice President and Chief Financial Officer Tracey Berg, Senior Vice President and Chief Information Officer Gary Alexander, Vice President - NSI Bonds Heather Dunn, Vice President and Controller David Ertmer, Vice President - Claims Kevin Steiner Rick Fox, Vice President and Chief Actuary Paul Hingtgen, Vice President - Argent® Rob Jacques, Vice President - Commercial Lines Gary Klein, Vice President - NSI® Mike DeLaney, Assistant Vice President - Argent Loss Control Jim Pauly, General Counsel Scott Grinna, Assistant Vice President – PAS Program Management John Reyzer, Vice President – NSI Finance Mike Kapfer, Assistant Vice President – NSI Underwriting Jim Schwalen, Vice President - Personal Lines & Marketing Jim Keal, Assistant Vice President - Argent Operations Kelly Tighe, Vice President - Sales Jason Moore, Assistant Vice President – IT Business Application Services Christopher Zwygart, Vice President and Chief Risk Officer Laura Morrow – Assistant Vice President – NSI Claims Debra Cahoon, Assistant Vice President - Human Resources Dave Nettum, Assistant Vice President – Argent Claims

Products Company Specializes In: West Bend offers a broad-coverage personal lines package with multiple rating tiers for home and auto. Many innovative enhancements and features are also available. The company also offers a full range of commercial products and services, as well as specialty lines, such as social services, sports and leisure, special events, childcare, and bonds through NSI, its specialty division. Its monoline workers’ compensation division, Argent, works closely with agents and policyholders to determine their most critical workers’ compensation needs and improve results through loss control, medical cost containment, and education. Outlook for the Company’s Future West Bend is well positioned to capitalize on the current market conditions. In 2015, the company maintained its A (Excellent) rating by A.M. Best. A.M. Best also recognizes West Bend as one of the 100 largest property/casualty insurers in the country. West Bend was again named to Ward Group’s list of the 50 top-performing property/casualty insurers in 2015, and is listed as a top company in a nationwide easeof-doing-business survey. The company will strive to maintain these rankings by advancing its technology, products, and services, while retaining its small-company, relationship-driven culture.

20 | OCTOBER 2015

Company Philanthropy The West Bend Independent Agents’ Fund was established in 2006 for nonprofit organizations served by the independent insurance agents who represent the company. Grants from the fund are aimed at improving these organizations and the lives of those served by them. In 2015, West Bend awarded $164,000 to non-profit organizations supported by its independent agents. Grants awarded from the Independent Agents’ Fund now total more than $900,000. In August 2014, West Bend, along with independent insurance agents who represent the company and key business partners, came together to raise $458,000 for the MACC Fund, Midwest Athletes Against Childhood Cancer. Since 2006, West Bend and the company’s independent agent partners have helped raise more than $1 million for the MACC Fund. Company Website: thesilverlining.com

VIRTUAL UNIVERSITY

WORDS MATTER: MINOR POLICY LANGUAGE CHANGES CAN LEAD TO MAJOR CONSEQUENCES

If you’ve ever been the victim of auto correct on a smartphone than you know words matter. That simple text to your mother-in-law can be quite embarrassing. In the world of insurance, reading policy language wrong can have more serious consequences. A question came into the Virtual University’s Ask An Expert service that focused on the importance of language.

I was reading an online discussion of an insurer’s CGL policy that made a minor language change to the ISO CGL policy. It modified the ‘insured contract’ provision under contractual liability. Is this something to be concerned about? The following is the insurer’s form language, based on the ISO contractual liability exclusion exception for damages:

It’s very important to read policy forms carefully.

‘Assumed by you in a contract or agreement that is an “insured contract”, provided that the “bodily injury” or “property damage” occurs subsequent to the execution of the contract or agreement. Solely for the purposes of liability assumed by you in an “insured contract”, reasonable attorney fees and necessary litigation expenses incurred by or for a party other than an insured will be deemed to be damages because of “bodily injury” or “property damage” provided that...’ [emphasis mine]. The wording above is identical to that in the ISO CGL except for the addition of the phrase ‘by you’ twice in the excerpt. This company form limits contractual liability to contracts entered into only by the named insured. This can be a significant reduction in coverage over the ISO form language—a perfect illustration of why it’s so important

to read policy forms very carefully. Consider this language from the ACORD 25: ‘This certificate does not amend, extend or alter the coverage afforded by the policies below.’ This is language from a proprietary certificate of insurance that otherwise looked identical to the ACORD 25: ‘This certificate does not amend, extend or alter the coverage afforded by the policies below except as shown below’ [emphasis mine]. Issuing this certificate would likely be illegal in every state in the country since it purports to modify the policy coverage, effectively making it an unfiled endorsement. But the agent had not noticed the difference and was prepared to issue the certificate.

> Bill Wilson is Director of the Virtual University of the IIABA. Contact Bill at bill.wilson@iiaba. net.

The Virtual University is a Big “I” members-only resource. Many articles are based on real-life questions received by the Ask an Expert service. This service ensures that the information is current and topical. Go to www.independentagent. com/Education/VU/. You will need to login with your IIABA username and password before using the VU. The IIABA does not assume and has no responsibility for liability or damage which may result from the use of any of this information.

22 | OCTOBER 2015

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MARKETING

5 MUSTS FOR INSURANCE AGENTS TRYING TO REACH MILLENNIALS When I say the word millennial what words come to your mind? I recently spoke to a group of business owners and asked them the same question. As expected, the answers I received were varied. I heard “entitled,” but I also heard the word “driven.” I heard “poor social skills,” but I also heard “connected.” The term millennial is often overused and typically misunderstood. This is a huge and diverse group that’s educated and connected to and through technology. Millennials have grown up with this connection. Understanding this generation is no longer optional. For your insurance business to survive long-term, you must find ways to attract, sell and wow millennials. Before I provide specific ways to market and sell to millennials, let me provide some background.

Let’s Talk Numbers on Millennials Millennials are those born in the early 1980s to the late 1990s. That means, right now, most millennials fall into the desirable 18-34 age demographic. There are an estimated 75,000,000 millennials. By 2025, they will account for 75% of the global market. These numbers can’t be overlooked. A recent study found the following trends on millennial habits:

sheer size of the millennial generation (it’s larger than the boomers), but they are equally important because of how they buy things. Millennials simply don’t relate to most forms of traditional advertising like previous generations. In general, millennials don’t: - Read newspapers - Watch television commercials - Answer telemarketing calls - Like any form of interruption

You must be visible and available 24/7. Your website, blog and social media presence is your digital storefront. What does it say about your agency? - Care about your sales pitch However, millennials do like to share great experiences with others using technology. So what does all of this mean to you the insurance agency owner?

You No Longer Control the Message > 65% of millennials said losing their phone or computer would have a greater impact than losing their car

Question: how do you market and sell to the largest and most connected demographic in history?

> 63% of millennials stay in touch with their favorite brands through social media

First, you must understand the trends and tendencies. Next, you must be open minded. Finally, you must realize that every generation brings a fresh set of ideas, skills and perspectives. Although you may not understand or agree with everything, you must adapt. Here are five ways you can better position your agency to market and sell to millennials.

> 84% say that word of mouth is their primary influencer when making a buying decision > 41% said they have made a recent purchase using their smartphones in the past month > It is estimated that millennials will spend $2,450,000,000 this year and by 2018 they will spend $3,400,000,000 (those are billions!) > Each day more than 10,000 millennials turn 21 These numbers are important because of the

26 | OCTOBER 2015

pandered to; they want to be engaged. If you try to manipulate them or bend the truth, you will likely lose their trust forever. Moreover, inaccuracies can no longer be blown off. Now inaccuracies are blown up. Did I mention that millennials are connected? Instead of complaining to a friend over coffee, reports of foul play are now shared on social media and through mass text. Trust has never been given and will always be earned. Millennials take this a step further as they can fact check and share complaints in seconds. It’s vital that you and your team develop and maintain a message of authenticity.

1. Your Message Must be Trustworthy and Authentic. The number one trait that millennials loathe is inauthenticity. Authenticity cannot be faked… ever. Millennials are arguably the most educated generation in history. They do not want to be

Acknowledging you can’t do something and delivering a sincere apology will go much further than promising something you can’t deliver. 2. You Must be Able to Leverage Technology and Create a Digital Presence. First of all, I didn’t say “understand and implement technology,” I said “leverage technology.” There is a huge difference. The point is that you don’t know how it all works, you just need to understand who it works for. Millennials have never known a world without the Internet. Yes, there have been enormous strides in Internet speed, delivery, and social tools like Facebook in recent years, but this has always been a technologically connected generation. More importantly, millennials (and all generations for that matter) are now connected wherever they go. You can update, text, tweet, or even make an actual phone call from anywhere at anytime. You must be visible and available 24/7. Your website, blog and social media presence is your digital storefront. What does it say about your agency? What is the first impression a millennial will have when finding you online? WISCONSIN INDEPENDENT AGENT

Fair or not, millennials will move on quickly if they can’t find what they are looking for or if they are simply unimpressed with what they see about you online. 3. You Must Provide Value That’s Useful to Them. This is really true of any generation, but millennials are known as the “Me Generation” for a reason. Too often insurance agencies market themselves in terms of their perceived value. I see and hear messages online and offline like, “We are an independent insurance agency,” “We have been in business since 1957,” and “We provide great customer service.” While all of that may be true, none of it says anything to a consumer, especially a millennial consumer. To reach millennials you must find ways to share how you solve specific problems, present new ideas, and share new information. You must be able to give away some of your “insurance secrets.” You no longer hold all the cards. Information is readily available and if you don’t provide it, someone else will. Providing valued information builds trust, credibility and likability. Just because you “give away” some of your hard earned knowledge doesn’t mean they will use you and go somewhere else. Sure, some will, but most will lean on you for advice through the buying process. 4. You Must Build Personal Relationships. After all this talk of technology, developing personal relationships may seem counterintuitive. Because millennials are connected by WISCONSIN INDEPENDENT AGENT

technology and inundated constantly with marketing messages, you must find a way to reach them through all the noise. To do this, you must create a message or messages with specific focus. Who are you trying to reach? What do they want? How can you help them? What problems can you solve? I have always maintained that “If you market

Becoming a masterful storyteller is one of the most important skills you can develop.

your core values? What is your business providing your community, your region, your state, your country, the world? Millennials long to be part of something and not just another cog in the consumer machine. If your value proposition only discusses competitive pricing and quality coverages, millennials will not buy in. Describe outcomes, not features. If you can successfully demonstrate how your business serves its prospects, customers and business community, the profit will take care of itself.

The Bottom Line to everyone, you market to no one.” This is especially true of millennials. The only way to cut through the noise and distractions millennials face, is to address them at a personal and emotional level. Becoming a masterful storyteller is one of the most important skills you can develop. Not everyone will like or resonate with your story, but remember, you can’t reach everyone. The key is to connect with those that relate and you serve best. Facts and figures are forgotten, but a great story is retold forever. Millennials can share your story over and over. What’s your story? 5. You Must Stand for Something Other Than Just Profit. As Simon Sinek wrote in his book, Start with Why, “People don’t buy what you do, they buy why you do it.” Millennials want to know why you are passionate about your industry, your community and those you serve. What are

No generation should be stereotyped with a broad brush. However, every generation grew up in a unique economic, social and technological era. Whether you are a millennial, gen Xer like me, or baby boomer who is unsure of how to adapt to this new generation, one thing is certain: the size and power of the millennials can’t be overlooked. Millennials will be the driving force in our economy over the next 50 years. You must find > Brent Kelly is the CEO ways to understand of BizzGrizz. BizzGrizz their tendencies to helps insurance agents utilize effective marketing grow your business and selling strategies and thrive into the for today’s insurance future. consumer.

OCTOBER 2015 | 27

2015-16 FALL PLANNING

VIPS GATHER FOR ANNUAL PLANNING SESSION Committees address challenges and opportunities; Learn that Donald Driver is the 2016 annual convention keynote speaker Beautiful Milford Hills Hunt Club in Johnson Creek hosted the IIAW’s 2015-16 Fall Planning Session on September 16. Steve Leitch, in his first duties as IIAW President, welcomed over 100 volunteer members who serve on the Association’s 10 committees. He started by asking all the VIPs in the room to stand up. After some initial hesitation he said, “Everyone in this room is a VIP. Please stand up.” He continued: “During the many years I’ve been involved, our Association has provided the types of services our members expect and deserve. This achievement is due to the efforts of everyone in this room and the talented volunteers who served before us. This is a testament to the success of the fall planning concept that we pioneered many years ago.” With so much talk about perpetuation in the insurance industry, it was fantastic to see that our largest committee was also our youngest.

28 | OCTOBER 2015

The Emerging Leaders Committee came out in force with nearly 30 members. Before the committees broke into groups, Steve introduced the committee chairs and our Exclusive Company Sponsors. The committee chairs include: Kim Dandrea, Agency Operations; Cathy Christensen, Automation/Technology; Tim Bever, Employee Benefits; Jack Demski, Emerging Leaders; Skip Hansen, Government Affairs; Lise Meyer Kobussen, Finance & Compensation; Kevin Murray, Industry Relations; Jeff Thiel, Marketing and Membership Development; Mike Walston, Smaller Agencies; and Tim Kakuska and Mark Truyman (co-chairs), Technical. Our Exclusive Company Sponsors for 2015-16 include: AAA Wisconsin, ACUITY Insurance, Burns & Wilcox, The Hanover Insurance Group, The IMT Group, Integrity Insurance, Liberty Mutual, Progressive, SECURA

Insurance, Sentry Insurance, SFM Insurance, Society Insurance, Travelers Insurance, West Bend Mutual and Wilson Mutual. “I and the rest of the Executive Committee strongly encourage you to express your personal gratitude to our committee chairs and those who work for our exclusive company sponsors for helping make our Association so successful,” said Steve. This year’s Fall Planning Session was divided into two parts. The committees first met to discuss challenges and opportunities that face the entire industry. Next, the committees convened again to outline one or two initiatives that will help address these challenges and opportunities in the coming year. All committee chairs shared their findings with the entire group. Steve also addressed political giving. “It’s extremely important that we contribute WISCONSIN INDEPENDENT AGENT

2015-16 FALL PLANNING

On September 16, over 100 volunteer committee members met at Milford Hills Hunt Club for the Association’s annual Fall Planning Session.

to the Insuring Wisconsin Growth Fund Conduit,” he said. “Your donations help the Association gain access to legislators who in turn advocate for or against legislation that supports the health of our industry.” Fall Planning participants also heard from some special guests. Marty Agather, Senior VP of Client Development at TrustedChoice. com, gave a presentation about the digital platform and how it works. Lobbyist Misha Lee and Josh Johanningmeier, IIAW General Counsel, spoke briefly about the political and legal issues that face the Association. At the conclusion of the Fall Planning Session, Steve unveiled the new IIAW membership video and a special video message from Donald Driver! Donald is the 2016 annual convention keynote speaker. Mark your calendars for May 11-12, 2016. After the formal meeting, all registered participants were invited to shoot sporting clays and compete in the Annie Oakley ShootOff. Rob Gudates of Philadelphia Insurance took the top honors in the Annie Oakley event. Mike Walston was the runner-up. Nonshooters were invited to play cards, dice and bag toss. In addition to our Exclusive Company Sponsors, we would also like to thank our Partner/Gold Level Sponsors: Amerisafe, Arlington/ Roe, Auto-Owners, EMC Insurance, Madison Mutual, Partners Mutual, Philadelphia Insurance, WPS Insurance, and Wisconsin Mutual Insurance. WISCONSIN INDEPENDENT AGENT

the We look for the best independent agents and build relationships that last the duration. We are committed to the independent agency system as the only means to deliver our products. Because of that, we work hand-inhand to help our agencies grow profitably.

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OCTOBER 2015 | 29

ERRORS & OMISSIONS

HOW TO FIRE A CUSTOMER A decision agency owners or managers sometimes face is how to “fire” a customer. Some customers frankly are more trouble than they’re worth. Some demand too much service in relation to the premium paid, some are antagonistic or abusive to staff, others just aren’t a good “fit” with the agency. So, how do you non-renew these customers legally and ethically?

Speaking of legally, this article is not legal advice. Please secure the services of a lawyer if you require legal advice.

Reasons You Would Want to Part Ways It seems unthinkable to intentionally sever ties with a client. It takes hard work to reel them in in the first place. But business is fluid and sometimes changes need to be made. To help you get started on developing procedures for this difficult task, here is a list of reasons why you would cut a client loose: - Client’s business operations have grown and you no longer have markets or professional expertise. - Clients who consistently consume more agency resources relative to the value they bring to the agency. - The agency may wish to target a particular market segment through minimum standards with regard to account size, limits of liability, or the purchase of optional coverages. - In an effort to maintain a profitable book of business and maximize its opportunity to benefit from company profit-sharing arrangements, the agency may impose underwriting guidelines that are more stringent than the company’s guidelines. • An agency, particularly in a small town, may be aware of an insured’s personal reputation or characteristics, such as heavy drinking, that could increase the exposure to loss. • The insured may display disruptive behavior in the agent’s office or be discourteous or even abusive to agency employees.

3 More Things to Consider Before You Cut Ties This is a big decision that should be handled with a great deal of thought. Consider the following:

30 | OCTOBER 2015

> Take a long-term perspective when determining if a client is profitable or not.

> Consider how you can make an unprofitable customer profitable before terminating the relationship.

standards on what you want your book to look like and then establish a method of measure. Those standards may include each account’s profitability, frequency that the customer calls, late payments, claims history, treatment of staff, or have they been non-renewed. Using some of these criteria on an ongoing basis to measure account profitability allows you to make informed business decisions. Create a letter that can be sent to clients that don’t make the cut. There’s more about this letter in the next section, Notifying the Client.

How To Approach the Carrier

Notifying the Client

According to a legal opinion from IIAA’s general counsel, an agency’s customer does not have a contractual right to the agency’s services. An agency, therefore, does not need the company’s permission to terminate the agency’s relationship with the customer. An agency has the right to request nonrenewal of a policy for its own reasons, which may have nothing to do with company underwriting guidelines. As long as the agency’s reasons for terminating the relationship complies with prohibitions against illegal discrimination (based on race, religion, color or national origin) and with rules, laws and policy provisions regarding proper notice of cancellation and nonrenewal.

Despite the fact that an agency has a right to request termination of its relationship with the customer, an agency does not have independent authority to send a policyholder a nonrenewal notice. The policy is a two-party contract between the insurance company and the named insured, and the agency is not a party. The policy authorizes only the insurance company to send a nonrenewal notice, subject to certain stated exceptions or granted authority. The carrier may decide to keep the client and assign the policy “in-house” or assign to another agent. Send a letter 60 days prior to renewal that states it is in the best interest of everyone to part ways or have the carrier send the Notice of Non-Renewal. Provide the insured with everything they need such as loss runs and schedule of policies. In the letter alluded to earlier, include information for the insured to continue coverage with the insurance company if they so desire. Inform the insured the date that your office will no longer service the policies. Send the resignation by registered mail. There are many reasons an agency may want to part ways. Documenting > Meggen Gagas is the IIAW’s Director the reasons and acting of Agency Services. within written office Contact her at procedures is best practices 608.210.2975 or meggen@iiaw.com. to avoid E&O claims.

> Consider the fallout from a customer who is unhappy about the separation. Is he/she influential in circles that you rely on for customers? Negative word-of mouth travels farther and louder than positive.

Carrier Responsibilities A company should accept an agency’s nonrenewal request once the company is satisfied that the agency is not making the request based on a reason that is restricted by law or rule. The company must be willing to provide a written statement concerning the reason for nonrenewal. The statement must fully explain the agent’s decision to non-renew, giving the precise incident, circumstance or risk factor(s) involved in the decision. In addition, the insurer must state that the agent is the source of information relied on regarding the incident.

Agent Responsibilities Part of your written renewal procedures should include the agency underwriting section. Set up

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CONTINUING EDUCATION

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STRATEGIC PARTNERSHIPS TO TRAIN AND RECRUIT DIVERSE TALENT INTO INDEPENDENT INSURANCE AGENCIES CONTINUED FROM PAGE 5

graduates to our industry. And we have only just begun.

Creating a Sustainable and Diverse Insurance Industry Workforce Another more localized, concentrated effort to attract, train and hire a more diverse population to work in independent agencies and the insurance industry is now underway in Madison. Recently, Willis Great Britain CEO Nicolas Aubert said: “People with different experiences and backgrounds can enrich the business with diversity of thought, skills and creative ideas. They can help us provide valuable insight from different perspectives to help us better serve global clients, respond to new challenges and reach out to new markets.” He continued: “Diverse teams get better results. They can challenge ideas, make us more innovative, more competitive and ultimately more successful. Having a diverse workforce makes good business sense. Strength lies in differences, not in similarities.” The IIAW Board of Directors, myself and industry legend Dave Pauly share Mr. Aubert’s vision and passion to diversify the industry’s ranks. Under Dave’s leadership and guidance, the IIAW is proud to be partnering with the Urban League of Greater Madison to engage and develop a sustainable diverse independent agency workforce. The IIAW will be working to initially train and license 25 pre-selected African-Americans and other minorities and place them into jobs with independent agencies and companies. Depending on the success of the program it is our intent to expand the program and partnership with the Urban League. Our members can be proud of the work we are accomplishing on their

32 | OCTOBER 2015

behalf to coordinate an industry wide response to identify and address the challenges of recruiting, training and developing a diverse workforce. This is yet another example of how we reinvest your membership dues and revenue from the E&O program to support your independent agency system. This forward thinking, concerted and comprehensive strategic approach to the industry’s impending talent crisis will hopefully get more people involved in the IIAW.

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S W E N E H T N I S R E B MEM CPCU Society Recognizes SECURA Staff Members On November 17, 2015, at its annual Industry Day, the CPCU Society Wisconsin Fox Valley Chapter will recognize many insurance professionals, including those from SECURA Insurance who completed the examinations and necessary experience requirements to earn their CPCU designation. Anthony Brecunier

Tanya Goerg

Matthew Stindt

Hugh de la Rosa

Angela Kasper

Devin O’Brien

The SECURA CPCU designees include: Anthony Brecunier, Hugh de la Rosa, Tanya Goerg, Angela Kasper, Matthew Stindt, and Devin O’Brien. The group will also present its annual scholarship to a University of Wisconsin – Oshkosh student enrolled in the Insurance and Risk Management program. Industry Day is November 17, 2015, at the Riverview Gardens in Appleton. The program will begin at 11:30 AM and features keynote speaker Rebecca Kleefisch, Wisconsin’s Lieutenant Governor.

To learn more about SECURA, please visit secura.net.

Milwaukee Business Journal Names R&R’s Franz a Top CFO Milwaukee Business Journal’s annual CFO awards included an executive from R&R Insurance Services in Waukesha. Michael Franz received the top honor in 2015 for small private companies. There were 14 winners chosen in all. Michael Franz

36 | OCTOBER 2015

Most CFOs work behind the scenes yet are major

players in company mergers and acquisitions, working closely with banks and lenders to balance the books, and also wear multiple hats as they oversee human resources, information technology or other company functions. Winners were nominated by colleagues and friends based on their wide range of experience, commitment, character and value to their organizations. Judges pored over dozens of nominations, narrowing the field to the final 14 winners. All winners will be profiled in the Milwaukee Business Journal’s Oct. 9 print edition and will be honored the same day at an awards luncheon in downtown Milwaukee. To learn more about R&R Insurance, please visit myknowledgebroker.com.

New Specialist Brings International Expertise to ACUITY Michael J Schlagenhaufer joins ACUITY in the newly created role of Manufacturing Business Segment Specialist at ACUITY. Michael brings with him extensive knowledge related to a variety of manufacturing operations and has worked in the automotive, aerospace, computer, plastic, leisure, and tooling industries. Mike Schlagenhaufer “Michael is an experienced, knowledgeable resource for our manufacturing customers and independent agents who focus on the manufacturing sector,” said Ben Salzmann, ACUITY President and CEO. “Hiring a dedicated Manufacturing Business Segment Specialist also reflects ACUITY’s commitment to meeting the insurance and risk management needs of manufacturers throughout our operating territory.” “I am excited about the opportunity to work with ACUITY’s manufacturing clients,” Michael said. “I have held many different roles in manufacturing over the years that have given me a deep understanding of the needs of manufacturers, including the insurance and risk management challenges they face.” Michael is a native of Germany and completed an 8,000-hour West German tool and die apprenticeship under the stewardship of Robert Bosch GmbH. He has an associate’s degree in tool and die from Carl Schaefer Berufsfach Schule in Ludwigsburg. In 1988, Michael moved to Milwaukee, where he worked as a tool and die maker. He later relocated to South Dakota, working WISCONSIN INDEPENDENT AGENT

S W E N E H T N I S R E B MEM as a W-EDM programmer and toolmaker lead for a computer disk drive manufacturer. In 1995, he moved to Eau Claire, Wisconsin, to supervise and manage the startup of a world class tool room that supported a 1 million-square-foot, high-volume manufacturing plant. In 2009, he relocated to Sparta, Wisconsin, to work as a Continuous Improvement Manger for Mathews Inc. and, in 2010, took over management of a 54,000-square-foot machining operation. In 2014, he moved to Plymouth to be machining manager at Warty LLC. ACUITY is active in manufacturing associations, and encourages a dialogue among the construction community via its Made in America page, facebook.com/acuitymanufacturing. To learn more about ACUITY, please visit acuity.com.

Diversified Insurance Launches Redesigned Website Brookfield, WI-based Diversified Insurance Solutions is excited to announce the successful launch of their newly redesigned website div-ins.com. The new website’s theme is based around the company’s regional pride as well as its successful client relationships formed through the years. These relationships are highlighted by client images, descriptions of the agency’s operations and testimonials describing how Diversified Insurance contributed to their success. In an effort to keep the website interesting and engaging Diversified will rotate different clients in and out throughout the year.

“We can continue to differentiate ourselves as the firm that is moving forward and helping people with the challenges they face in today’s world.” The new website also contains some advanced features. For example, clients have the ability to send information directly to Diversified Insurance through the website. Also, clients will be able to submit information in real-time from their computer or mobile device to customer service team members to help them resolve issues immediately. The site also allows visitors to request a quote, browse a frequently updated library of educational material, read the D-Blog, and more. To learn more about Diversified Insurance Solutions, please visit div-ins.com.

QBE North America Names Fireman’s Fund’s Zortman as President, Standard Lines QBE North America said that it has named former Fireman’s Fund executive Kathleen O. Zortman as president, Standard Lines, for property/casualty insurance. Zortman will have responsibility for QBE North America’s commercial, personal, program and agriculture businesses.

“Our partners fuel incredible growth in Southeast Wisconsin,” said CEO Chris Lie. “It’s the people and ideas we insure that are making the difference.”

Zortman has been an underwriter, broker and management consultant in her 25 years in the industry. She was most recently with Fireman’s Fund Insurance Co. as chief field executive managing a field organization of 1,000 employees and $2.3 billion in gross written premium. In this role Zortman was responsible for distribution, underwriting and customer service across commercial, programs, professional liability, farm and ranch, entertainment and high-net-worth personal insurance divisions.

Senior Vice President and shareholder David Stark continued:

To learn more about QBE, please visit qbena.com.

ϳϬй ŽĨ ĂŐĞŶĐǇ ŽǁŶĞƌƐ ĚŽŶ͛ƚ ŚĂǀĞ Ă ƉĞƌƉĞƚƵĂƟŽŶ ƉůĂŶ Ͳ >Ğƚ ZK Zd^KE Zz E Ğ WĂƌƚ KĨ zŽƵƌ &ƵƚƵƌĞ You’ve built a successful agency and book of business but don’t have someone to take it ŽǀĞƌ ǁŚĞŶ ǇŽƵ ƌĞƟƌĞ͘ tŚĂƚ ĚŽ ǇŽƵ ĚŽ͍

Plan your future with Robertson Ryan & Associates͘ Ǉ ũŽŝŶŝŶŐ ŽƵƌ ƚĞĂŵ ŝƚ ĂůůŽǁƐ ǇŽƵ ƚŽ͗ ͻ ͻ ͻ ͻ ͻ

Keep your book Remain a trusted advisor to your clients to give them peace of mind ŽŶƟŶƵĞ ǁŽƌŬŝŶŐ ƵŶƟů ǇŽƵ ĚĞĐŝĚĞ ƚŽ ƌĞƟƌĞ Find the right buyer for your book within Robertson Ryan to maximize your return Ğ ŝŶ ƚŚĞ ϯϬй ƚŚĂƚ ŚĂǀĞ Ă ƉůĂŶ

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OCTOBER 2015 | 37

TECHNOLOGY

IRS WARNS TAXPAYERS TO GUARD AGAINST NEW TRICKS BY SCAM ARTISTS

A few weeks ago Karen received a call on her cell phone. A gentleman said he was calling from “Microsoft” to fix her computer. She told him he needed to talk with “her techie husband” and handed me the phone. I promptly hung up. She wanted to string him along. I did not want to waste my time. The number and sophistication of scams seem to be increasing. A popular one is a phone call from the IRS demanding payment for overdue taxes. Two weeks ago the Internal Revenue Service issued another warning to taxpayers to remain on high alert and protect themselves against the ever-evolving array of deceitful tactics scammers use to trick people. These schemes – which can occur over the phone, in emails or through letters with authentic-looking letterhead – try to trick taxpayers into providing personal financial information or scare people into making a false tax payment that ends up with the criminal. The Treasury Inspector General for Tax Administration (TIGTA) has received reports of roughly 600,000 contacts since October 2013. TIGTA is also aware of more than 4,000 victims who have collectively reported over $20 million in financial losses as a result of tax scams. Scammers posing as IRS agents first targeted those they viewed as most vulnerable, such as older Americans, newly arrived immigrants, and those whose first language is not English. These criminals have expanded their net and are now targeting virtually anyone. In a new variation, scammers alter what appears on your telephone caller ID to make it seem like they are with the IRS or another agency such as the Department of Motor Vehicles. They use > Steve Anderson fake names, titles, and provides information badge numbers. They use to insurance agents about how they can online resources to get use technology to your name, address, and increase revenue and/ or reduce expenses. Go other details about your to steveanderson.com. life to make the call sound

38 | OCTOBER 2015

official. They even go so far as copying official IRS letterhead for use in email or regular mail.

Below are five things scammers often do that the real IRS would never do.

Brazen scammers will even provide their victims with directions to the nearest bank or business where the victim can obtain a means of payment such as a debit card. And in another

The IRS will never: 1. Angrily demand immediate payment over the phone, nor will the agency call about taxes owed without first having mailed you a bill.

Scammers use online resources to get your name, address, and other details about your life to make the call sound official. They even go so far as copying official IRS letterhead for use in email or regular mail.

2. Threaten to bring in local police or other law enforcement groups to have you arrested for not paying.

new variation of these scams, con artists may then provide an actual IRS address where the victim can mail a receipt for the payment – all in an attempt to make the scheme look official. These scam artists often angrily threaten police arrest, deportation, license revocation or other similarly unpleasant things. They may also leave “urgent” callback requests, sometimes through “robo-calls,” via phone or email. The emails will often contain a fake IRS document with a telephone number or email address for your reply. It is important to remember the official IRS website is IRS.gov. Taxpayers are urged not to be confused or misled by sites claiming to be the IRS but ending in .com, .net, .org or other designations instead of .gov. Taxpayers should never provide personal information, financial or otherwise, to suspicious websites or strangers calling out of the blue.

3. Demand that you pay taxes without giving you the opportunity to question or appeal the amount they say you owe. 4. Require you to use a specific payment method for your taxes, such as a prepaid debit card. 5. Ask for credit or debit card numbers over the phone. Here’s what you should do if you think you’re the target of an IRS impersonation scam: D If you do owe taxes, call the IRS at (800) 8291040. IRS workers can help you with a payment issue. D If you know you don’t owe taxes or do not immediately believe that you do, you can report the incident to the Treasury Inspector General for Tax Administration (TIGTA) at (800) 366-4484. D If you’ve been targeted by any scam, be sure to contact the Federal Trade Commission and use their FTC Compliant Assistant. Please add “IRS Telephone Scam” to the comments of your complaint. For more information on reporting tax scams, go to IRS.gov and type “scam” in the search box. This information would be a good reminder to send out to your clients and prospects. WISCONSIN INDEPENDENT AGENT

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COMMENTARY FROM COUNSEL

What insurance agencies (and businesses generally) need to take away from Judge Berman’s decision is that…you must conduct yourself fairly, or a court may throw a flag.

LESSONS FROM DEFLATEGATE FINALLY—FOOTBALL SEASON! And what better way to start the season than a federal judge exonerating the defending Super Bowl champion quarterback for his role (whatever it may have been) in using under-inflated footballs during the AFC championship game. Then again, the judge’s decision may be fairly viewed less as an exoneration of Tom Brady, and more as a scathing critique of the league’s handling of the investigation and disciplinary proceeding. You may be asking yourself—what does this have to do with my insurance agency? For better or worse, you are probably not involved in the day-to-day operations of a professional sports league, or managing a unionized workforce, but there are valuable lessons to be learned from “deflategate.” The particular situation is just the latest instance of commissioner Roger Goodell’s disciplinary decision being overruled. A New York federal judge tossed out Goodell’s four-game suspension levied on Brady based on an investigator’s conclusion that he was “generally aware” that equipment personnel were intentionally deflating footballs. Judge Richard Berman overturned the suspension not because the league lacked authority under the collective bargaining agreement to investigate and discipline, but rather because of the flawed investigation and appeal process and a lack of notice to players that such conduct could result in suspension. WISCONSIN INDEPENDENT AGENT

What insurance agencies (and businesses generally) need to take away from Judge Berman’s decision is that—even with enormous authority, granted by contract or merely by status as employer—you must conduct yourself fairly, or a court may throw a flag. Prudent employers will give adequate notice of what is considered misconduct, what the consequences are for that misconduct, and then employ a fair process when investigating problems. Again, using the deflategate example, on its face, Judge Berman’s conclusion that Brady did not have notice of his misconduct seems odd. Of course, deflating footballs below the limits allowed under the rules of the game is a patently obvious transgression; however, the requirement of notice also encompasses notice of the level of potential discipline. Even if Brady knew of his misconduct, the judge found that he did not know that he could be suspended for four games. This is where notice of discipline and having a consistent disciplinary procedure come together and affect how a court views a case. It should be noted that the NFL’s disciplinary procedure is governed by the collective bargaining agreement (CBA) negotiated by the league and the NFL Players Association. The CBA contains an extensive list of infractions and maximum penalties.The rules relating to equipment violations state that first offenses will result in fines. In Brady’s case, the commissioner

doled out much more than a fine—he suspended Brady for four games, fined the Patriots $1 million and took away two high draft picks. What about fair process? Well, hypothetically (or, actually) assume you were a football player who has been suspended for four games over a few deflated footballs, while another player gets a two-game suspension after knocking out his wife? You’d probably appeal it. But the collective bargaining agreement gives very limited rights to players contesting league discipline in this situation. For example, if a player wants to appeal the commissioner’s disciplinary decision, the appeal is made to the commissioner (or he can appoint a hearing officer, or even appoint himself as hearing officer, for the appeal). Before you lose too much sleep over this procedure, remember that the NFLPA agreed to it as part of the CBA. Yet, as Judge Berman’s decision teaches us, fair process is still required. According to the judge, “[Goodell] dispensed his own brand of industrial justice.” This should serve as a critical lesson: even if you have a contractual advantage over a party, you are still bound by a duty of good faith and fair dealing (in the > Josh Johanningmeier non-labor-law context) and is the IIAW’s General Counsel. Call the Legal sharp tactics may be met Services Hotline at (877) with judicial intervention. 236-1669.

OCTOBER 2015 | 41

FOOD FOR THOUGHT EARTH MAY NEED TO ADD ON ANOTHER BEDROOM

The world is expected to add another billion people within the next 15 years, bringing the total global population from 7.3 billion in mid-2015 to 8.5 billion in 2030, 9.7 billion in 2050, and 11.2 billion by 2100. Currently, 60 percent of the global population lives in Asia, 16 percent in Africa, 10 percent in Europe, 9 Looking to remodel percent in Latin America and the Caribbean, and only 5 percent in North America and Oceania. China and India are the largest countries in the world, together making up almost 40 percent of the world population, but Nigeria is exploding. By 2050, that country will be bigger than the U.S. and the third most populous country in the world. Nearly half of the world’s population growth before 2050 will be concentrated in nine countries: India, Nigeria, Pakistan, Democratic Republic of the Congo, Ethiopia, Tanzania, the U.S., Indonesia and Uganda. Source: Washington Post & United Nations

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The Ashley Madison hack exposed some 32 million records from all over the United States. The level of infidelity in this country is so pervasive, only three ZIP codes/cities had no users on the website. They include: Nikolai, Alaska (pop. 94), Perryville, Alaska (pop. 113), and Polvadera, New Mexico (pop. 269). Presumably, there is no Internet in these isolated burgs. Otherwise, they’d be getting busy, too. About as surprising as a toddler falling down, Washington, D.C. topped the list for the most cheaters. Even less shocking than a drunk getting lit at an open bar, D.C.’s Capitol Hill area (politicians, staffers, etc.) came in at #1. Source: Gawker & Washington Post

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